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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Kellan Grp | LSE:KLN | London | Ordinary Share | GB00B03W5P29 | ORD 0.01P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 0.30 | 0.25 | 0.35 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
From May 2019 to May 2024
TIDMKLN
RNS Number : 5996H
Kellan Group (The) PLC
19 August 2016
19 August 2016
The Kellan Group PLC
("Kellan" or "the Group")
Interim results for the six months ended 30 June 2016
Kellan Group plc (the "Group" or the "Company" or "Kellan") is a market leading recruitment business operating across a wide range of functional disciplines and industry sectors.
Financial Summary
-- In the six months ended 30 June 2016, the Group's year-on-year sales declined by 13% to GBP10.0 million, compared with GBP11.5 million in H1 2015; while Net Fee Income (NFI) declined by 10% from GBP3.7 million in H1 2015 to GBP3.3 million in H1 2016.
-- Continuous focus on overheads with administrative expenses reduced by 2% to GBP3.3 million over H1 2016, compared with GBP3.4 million during the comparable period in H1 2015 and GBP3.5 million in H2 2015.
-- Adjusted EBITDA profit (Note 2) of GBP0.2 million during H1 2016 compared with GBP0.4 million during H1 2015.
-- Loss of GBP0.1 million during H1 2016, compared with a profit of GBP0.2 million during the comparable period last year. Excluding the effect of the GBP150,000 favourable share based payment adjustment in H1 2015, year-on-year earnings before tax declined from break even in H1 2015 to a loss of GBP0.1 million in H1 2016.
Operational summary
-- Berkeley Scott continues to be the leader in hospitality and leisure recruitment markets. January saw Berkeley Scott return to the Birmingham market, and the team have performed well.
-- The RK business has continued to grow and has seen increased success within the construction, manufacturing and practice markets.
ENQUIRIES:
The Kellan Group PLC Tel: 020 7268 6200 Rakesh Kirpalani, Group Finance Director Allenby Capital Limited Tel: 020 3328 5656 David Worlidge / James Thomas
Executive Chairman's Statement
The results for the first six months of 2016 have been disappointing, although the Group has had success in securing new clients and growing some areas of the business. Group sales have decreased by 13% from GBP11.5 million in H1 2015 to GBP10.0 million in H1 2016, while administrative expenses have reduced by 2% from GBP3.4 million in H1 2015 to GBP3.3 million in H1 2016. Overall loss for H1 2016 of GBP141,000 compared with a profit of GBP187,000 in H1 2015. Excluding the effect of the GBP150,000 favourable share-based payment adjustment in H1 2015, year-on-year earnings before tax declined from break even in H1 2015 to a loss of GBP0.1 million in H1 2016. Adjusted EBITDA for H1 2016 of GBP211,000 compared with GBP382,000 in H1 2015.
Berkeley Scott's temporary business was flat year-on-year with the new Living Wage impacting H1 performance. The Tourism, Hospitality and Leisure sector has one of the highest proportion of jobs paying the minimum wage of any sector in the UK. Berkeley Scott saw several major clients re-evaluate their staffing levels, pay structures and usage of temporary workers to negate the impact of the minimum wage on their business. January saw Berkeley Scott return to the Birmingham market to leverage many of our national contract catering clients who have been supportive of this Midlands opening.
Berkeley Scott's permanent business NFI declined by 10% on H1 2015 with the London market proving to be more challenging than anticipated with NFI from London declining by 14% on H1 2015.
Following careful evaluation of our performance, the Berkeley Scott business was restructured with Mark Darby becoming directly responsible and managing Berkeley Scott London which, as a whole, was one of the main contributors to the underperformance. The Directors believe it is very important that this large part of the business is turned around over H2.
The RK business continues to grow and has seen increased success within property, construction and manufacturing sectors. A focus on practice markets has delivered promising results, particularly in Lancashire.
Quantica Technology has seen its NFI decline by GBP290,000; of which GBP127,000 relates to the closure of the Birmingham branch in Q2 2015. The retail division has benefited from the rise of new hybrid roles in the market and has delivered growth on the same period last year. Quantica Search and Selection has re-established relationships with PSL clients and won new SME business.
Uncertainty surrounding the EU referendum has been a distraction in H1 of 2016 with many clients taking longer to make decisions. We have also seen some general slowness post referendum in job flow and candidate attraction.
My sincerest thanks goes to our staff, all of our customers, and to all our loyal shareholders for their continued support.
Richard Ward
Executive Chairman
Consolidated Statement of Comprehensive Income
For the six months ended 30 June 2016
Hot Features
Premium
Unaudited Unaudited Audited
6 months 6 months 12 months
ended ended ended
30 June 30 June 31 December
2016 2015 2015
Note GBP000 GBP000 GBP000
Revenue 9,985 11,492 24,864
Cost of sales (6,650) (7,788) (17,163)
-------------------------- ----- ---------- ---------- ------------
Net Fee Income 3,335 3,704 7,701
Administrative expenses (3,304) (3,363) (6,877)
-------------------------- ----- ---------- ---------- ------------
Operating profit 2 31 341 824
Financial income - 2 8
Financial expenses (172) (156) (406)
-------------------------- ----- ---------- ---------- ------------
(Loss)/Profit before
tax (141) 187 426
Tax credit - - -
------------------------- ----- ---------- ---------- ------------
(Loss)/Profit for
the period (141) 187 426
-------------------------- ----- ---------- ---------- ------------
Attributable to:
Equity holders of
the parent (141) 187 426
-------------------------- ----- ---------- ---------- ------------
(Loss)/Profit per
share in pence
Basic 3 (0.04) 0.06 0.13
Diluted 3 (0.04) 0.06 0.11
-------------------------- ----- ---------- ---------- ------------
The above results relate to continuing operations.
There are no other items of comprehensive income for the period or for the comparative periods.
Consolidated Statement of Financial Position
as at 30 June 2016
Unaudited Unaudited Audited
30 June 30 June 31 December
2016 2015 2015
Note GBP000 GBP000 GBP000
Non-current assets
Property, plant and
equipment 338 307 382
Intangible assets 6 6,021 6,237 6,129
------------------------------------- ----- ---------- ---------- ------------
6,359 6,544 6,511
------------------------------------- ----- ---------- ---------- ------------
Current
assets
Trade and other receivables 4 3,288 3,733 4,415
Cash and cash equivalents 315 219 1,708
------------------------------------- ----- ---------- ---------- ------------
3,603 3,952 6,123
------------------------------- ----- ----- ---------- ---------- ------------
Total assets 9,962 10,496 12,634
------------------------------- ----- ----- ---------- ---------- ------------
Current liabilities
Loans and borrowings 2,118 845 2,887
Trade and other payables 5 2,639 3,289 3,056
Provisions 18 128 67
------------------------------------- ----- ---------- ---------- ------------
4,775 4,262 6,010
------------------------------ ------ ----- ---------- ---------- ------------
Non-current liabilities
Loans and borrowings 1,776 2,993 3,095
Provisions 65 2 42
1,841 2,995 3,137
------------------------------------- ----- ---------- ---------- ------------
Total liabilities 6,616 7,257 9,147
-------------------------------- ---- ----- ---------- ---------- ------------
Net assets 3,346 3,239 3,487
-------------------------------- ---- ----- ---------- ---------- ------------
Equity attributable
to equity holders of
the parent
Share capital 4,274 4,274 4,274
Share premium 14,746 14,746 14,746
Convertible debt reserve 170 170 170
Capital redemption
reserve 2 2 2 Retained earnings (15,846) (15,953) (15,705) ------------------------------------- ----- ---------- ---------- ------------ Total equity 3,346 3,239 3,487 -------------------------------- ---- ----- ---------- ---------- ------------
Consolidated Statement of Changes in Equity
for the six months ended 30 June 2016
Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited
Share Share Warrant Convertible Redemption Retained Total
capital premium reserve reserve reserve earnings equity
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
Balance at
31 December
2014 4,274 14,711 36 164 2 (15,981) 3,206
--------------------- ---------- ---------- ---------- ------------ ----------- ---------- ----------
Total comprehensive
profit for
the 6 month
period ended
30 June 2015 - - - - - 187 187
Issue of shares - 35 - - - - 35
Share based
payment - - - - - (150) (150)
Equity component
of convertible
loan notes - - (36) 6 - (9) (39)
Balance at
30 June
2015 4,274 14,746 - 170 2 (15,953) 3,239
--------------------- ---------- ---------- ---------- ------------ ----------- ---------- ----------
Total comprehensive
profit for
the 6 month
period ended
31 December
2015 - - - - - 239 239
Equity component
of convertible
loan notes - - - - - 9 9
Balance at
31 December
2015 4,274 14,746 - 170 2 (15,705) 3,487
--------------------- ---------- ---------- ---------- ------------ ----------- ---------- ----------
Total comprehensive
loss for the
6 month period
ended 30 June
2016 - - - - - (141) (141)
Balance at
30 June
2016 4,274 14,746 - 170 2 (15,846) (3,346)
--------------------- ---------- ---------- ---------- ------------ ----------- ---------- ----------
Consolidated Statement of Cash Flows
for the six months ended 30 June 2016
Unaudited Unaudited Audited
6 months 6 months 12 months
ended ended ended
30
June 30 June 31 December
2016 2015 2015
GBP000 GBP000 GBP000
Cash flows from operating
activities
(Loss)/Profit for the
period (141) 187 426
Adjustments for:
Depreciation and amortisation 157 171 327
Interest income - (2) -
Interest paid 138 129 370
Amortisation of loan
cost 10 19 29
Equity settled convertible
loan interest 24 7 7
Equity settled share-based
payment/(adjustment) - (150) (150)
188 361 1,009
Decrease/(Increase) in
trade and other receivables 1,127 122 (560)
(Decrease)/Increase in
trade and other payables (417) 333 108
Decrease in provisions (26) (26) (47)
------------------------------------ ---------- ---------- -------------------
Net cash inflow from
operating activities 872 790 510
------------------------------------ ---------- ---------- -------------------
Cash flows from investing
activities
Interest received - 2 -
Acquisition of property,
plant and equipment (5) (37) (161)
------------------------------------ ---------- ---------- -------------------
Net cash outflow from
investing activities (5) (35) (161)
------------------------------------ ---------- ---------- -------------------
Cash flows from financing
activities
Repayment of invoice
discounting balance (2,122) (1,584) 458
Interest paid and loan
costs (138) (129) (276)
Repayment of term loan
borrowings - (15) (15)
------------------------------------ ---------- ---------- -------------------
Net cash inflow/(outflow)
from financing activities (2,260) (1,728) 167
------------------------------------ ---------- ---------- -------------------
Net (decrease) / increase
in cash and cash equivalents (1,393) (973) 516
Cash and cash equivalents
at the beginning of the
period 1,708 1,192 1,192
------------------------------------ ---------- ---------- -------------------
Cash and cash equivalents
at the end of the period 315 219 1,708
-------------------------------------- ---------- ---------- -------------------
Notes
(forming part of the financial statements)
1 Accounting policies
Accounting periods
The accounting reference date of the Group is 31 December. The current half year interim results are for the six months ended 30 June 2016. The comparative half year interim results are for the six months ended 30 June 2015. The comparative year's results are for the twelve months ended 31 December 2015.
Financial information
The financial information for the six months ended 30 June 2016 and the six months ended 30 June 2015 are unaudited and un-reviewed and do not constitute the Group's statutory financial statements for those periods. The comparative financial information for the full year ended 31 December 2015 has, however, been derived from the audited statutory financial statements for that period. A copy of those statutory accounts for that period has been delivered to the Registrar of Companies. The auditor's report on those accounts was not qualified and did not contain statements under Chapter 3 of Part 16 of the Companies Act 2006.
Basis of preparation
The half year interim financial statements have been prepared on a going concern basis using the recognition and measurement principles of IFRS as endorsed for use in the European Union. The accounting policies used in the preparation of these condensed financial statements are set out in the statutory financial statements for the period ended 31 December 2015 which are also the policies that are expected to be applicable at 31 December 2016.
Based on the Group's latest trading expectations and associated cash flow forecasts, the directors have considered the cash requirements of the Company and, subject to the refinancing or conversion of the GBP1.35m loan notes which are repayable in February 2017, have concluded that the Group will be able to operate within its existing facilities for the next twelve months. These facilities comprise an invoice discounting facility of up to GBP4 million dependent on trading levels. The Directors also recognise that there is a general sensitivity to the wider macro-economic environment which may necessitate a requirement for additional funding. However, based on the ongoing support from major shareholders and management's trading expectations; the Directors are confident that the Group will be able to meet its liabilities as they fall due for the foreseeable future. It is on this basis that the Directors consider it appropriate to prepare the Group's financial statements on a going concern basis.
2 Reconciliation of operating loss to adjusted EBITA and adjusted EBITDA
Unaudited Unaudited Audited
6 month 6 month 12 month
period period period
ended ended ended
30 June 30 June 31 December
2016 2015 2015
GBP000 GBP000 GBP000
Operating profit as per accounts 31 341 824
Add back
Amortisation of intangible
assets 108 108 216
Share-based payments adjustment - (150) (150)
Restructuring costs 23 20 20
---------------------------------- ---------- ---------- ------------
Adjusted EBITA 162 319 910
Depreciation 49 63 111
---------------------------------- ---------- ---------- ------------
Adjusted EBITDA 211 382 1,021
---------------------------------- ---------- ---------- ------------
3 Loss per share
Basic loss per share
The calculation of basic (loss)/earnings per share is as follows:
Unaudited Unaudited Audited
6 month 6 month 12 month
period ended period ended period ended
30 June 30 June 31 December
2016 2015 2015
Weighted average
number of shares
---------------------- ------------- ------------- -------------
Issued ordinary
shares at beginning
of period 339,645,061 337,894,529 337,894,529
Effect of shares
issued - 1,750,532 1,506,605
Weighted average
number of shares
at end of period 339,645,061 339,154,527 339,401,134
(Loss)/Profit
for the period (141,000) 187,000 426,000
---------------------- ------------- ------------- -------------
Basic (loss)/profit
per share in
pence (0.04) 0.06 0.13
---------------------- ------------- ------------- -------------
Diluted (loss)/
profit per share
in pence (0.04) 0.06 0.11
---------------------- ------------- ------------- -------------
There was no dilution in the current period due to the loss in the period.
The effect of the conversion of the loan notes and the outstanding Employee options has been determined as non-dilutive. As such they have been excluded from the diluted earnings per share calculation.
4 Trade and other receivables
Unaudited Unaudited Audited
30 June 30 June 31 December
2016 2015 2015
GBP000 GBP000 GBP000
-------------------------------- ---------- ---------- ------------
Trade receivables 2,923 3,429 4,131
Other receivables 23 23 21
Prepayments and accrued income 342 281 263
-------------------------------- ---------- ---------- ------------
3,288 3,733 4,415
-------------------------------- ---------- ---------- ------------
5 Trade and other payables
Unaudited Unaudited Audited
30 June 30 June 31 December
2016 2015 2015
GBP000 GBP000 GBP000
------------------------------ ---------- ---------- ------------
Trade payables 113 57 74
Social security and other
taxes 755 902 965
Other creditors 604 910 589
Accruals and deferred income 1,167 1,420 1,428
------------------------------ ---------- ---------- ------------
2,639 3,289 3,056
------------------------------ ---------- ---------- ------------
6 Intangible Assets
The intangible assets balance at 30 June 2016 of GBP6,021,000 includes an amount of GBP5,750,000 relating to goodwill acquired through business combinations. Impairment of this balance has been assessed as at 30 June 2016 and no adjustment was considered necessary. The Directors believe the assumptions used in testing impairment at 31 December 2015 are still valid and have not materially changed. These assumptions will continue to be reassessed on a six monthly basis.
7 Availability of Interim Results
The half year results for the six months to 30 June 2016 will not be posted to shareholders but will be available on the Company's website, www.kellangroup.co.uk.
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR QVLFFQVFXBBV
(END) Dow Jones Newswires
August 19, 2016 02:00 ET (06:00 GMT)
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